Accounting Report: Trial Balance and Financial Statements

This comprehensive accounting report provides a detailed analysis of Paul Services' financial statements, including the trial balance, adjusting entries, and the preparation of the income statement, balance sheet, and statement of changes in equity. The report begins with an introduction to the trial balance, explaining its purpose and the steps involved in its preparation, followed by a discussion on adjusting entries and their role in converting accounting records to the accrual basis. The report then presents an adjusted trial balance and proceeds to prepare the financial statements, including the income statement, which calculates the net profit, the balance sheet, which presents the company's assets, liabilities, and equity, and the statement of changes in equity. The report also covers the closing entries and concludes with a summary of the key findings. The report illustrates the practical application of accounting principles and provides a thorough understanding of the financial reporting process.

ACCOUNTING 1
ACCOUNTING

ACCOUNTING 2
Contents
Step 2:.........................................................................................................................................3
Step 3:.........................................................................................................................................4
Step 4:.........................................................................................................................................7
Step 5:.........................................................................................................................................8
Step 6:.......................................................................................................................................10
Step 7:......................................................................................................................................10
Introduction:.........................................................................................................................10
Part 1:....................................................................................................................................11
Part 2:....................................................................................................................................12
Part 3:....................................................................................................................................14
Part 4:....................................................................................................................................17
Conclusion:...........................................................................................................................18
References:..............................................................................................................................18

ACCOUNTING 3
Step 2:
Particulars Debit Credit
Interest expense
17,200.0
0
To interest payable
17,200.0
0
Supplies expense
1,290.0
0
To Supplies
1,290.0
0
Insurance expense
2,752.0
0
To prepaid insurance
2,752.0
0
Depreciation expense-office furniture
8,000.0
0
To Accumulated depreciation-office
furniture 8000
Depreciation expense-office equipment
16,000.0
0

ACCOUNTING 4
To Accumulated depreciation-office
equipment
16,000.0
0
Depreciation expense-equipment
12,000.0
0
To Accumulated depreciation-equipment
12,000.0
0
Depreciation expense-automobile
17,000.0
0
To Accumulated depreciation-automobile
17,000.0
0
Revenue
10,750.0
0
To unearned revenue
10,750.0
0
Step 3:
Unadjuste
d trial
balance
Adjustm
ent
Adjust
ed trial
balance
Inco
me
state
ment
Bala
nce
Shee
t
Deb
it
Cre
dit
De
bit
Cr
edi
Debit Cre
dit
Debit Cre
dit
Debi
t
Cre
dit

ACCOUNTING 5
t
1
0
1 Cash at Bank
7
1,5
00.
00
71,50
0.00
71
,500.
00
1
0
5
Accounts
Receivable
2
3,8
30.
00
23,83
0.00
23
,830.
00
1
1
5 Supplies
1,7
20.
00
1
,29
0.0
0
43
0.00
430.
00
1
2
0
Prepaid
Insurance
3,4
40.
00
2
,75
2.0
0
68
8.00
688.
00
1
3
5
Office
Furniture
4
3,0
00.
00
43,00
0.00
43
,000.
00
1
3
7
Acc.
Depreciation.
- Furniture
8
,00
0.0
8,0
00.
8,0
00.

ACCOUNTING 6
0 00 00
1
4
0
Office
Equipment
8
6,0
00.
00
86,00
0.00
86
,000.
00
1
4
1
Acc.
Depreciation
- Equipment
16
,00
0.0
0
1
6,0
00.
00
1
6,0
00.
00
1
4
5
Store
Equipment
1,2
9,0
00.
00
1,29,00
0.00
1,29
,000.
00
1
4
6
Acc.
Depreciation
- Equipment
12
,00
0.0
0
1
2,0
00.
00
1
2,0
00.
00
1
7
0 Automobile
1,7
2,0
00.
00
1,72,00
0.00
1,72
,000.
00
1
7
1
Acc.
Depreciation
- Automobile
17
,00
0.0
0
1
7,0
00.
00
1
7,0
00.
00

ACCOUNTING 7
2
0
1
Accounts
Payable
4
7,66
0.00
4
7,6
60.
00
4
7,6
60.
00
2
0
1
Interest
Payable
7
1,49
0.00
17
,20
0.0
0
8
8,6
90.
00
8
8,6
90.
00
2
0
1
Unearned
revenue
2
1,50
0.00
10
,75
0.0
0
1
0,7
50.
00
1
0,7
50.
00
2
0
1 Loan Payable
8,60
0.00
8,6
00.
00
8,6
00.
00
2
0
1
Mortgage
Payable
1,7
2,00
0.00
1,7
2,0
00.
00
1,7
2,0
00.
00
2
0
1 Paul's Capital
5
1,84
2.00
5
1,8
42.
00
1,4
5,7
48.
00
2 Paul's 17

ACCOUNTING 8
0
1 Drawings
172
.00 2.00
2
0
1 Revenue
1,7
2,00
0.00
10
,75
0.0
0
1,8
2,7
50.
00
1,8
2,7
50.
00
2
0
1
Advertising
Expense
1,4
00.
00
1,40
0.00
1,
400.0
0
2
0
1
Automobile
Expense
5,7
75.
00
5,77
5.00
5,
775.0
0
2
0
1
Depreciation
Expense -
Furniture
8
,00
0.0
0
8,00
0.00
8,
000.0
0
2
0
1
Depreciation
Expense -
Equipment
16
,00
0.0
0
16,00
0.00
16,
000.0
0
2
0
1
Depreciation
Expense -
Store
12
,00
0.0
12,00
0.00
12,
000.0
0

ACCOUNTING 9
Equipment 0
2
0
1
Depreciation
Expense -
Automobile
17
,00
0.0
0
17,00
0.00
17,
000.0
0
2
0
1
Insurance
Expense
1,2
00.
00
2
,75
2.0
0
3,95
2.00
3,
952.0
0
2
0
1
Maintenance
Expense
4,9
00.
00
4,90
0.00
4,
900.0
0
2
0
1
Miscellaneou
s Expense
1,1
55.
00
1,15
5.00
1,
155.0
0
2
0
1 Rent Expense - -
2
0
1
Supplies
Expense
1
,29
0.0
0
1,29
0.00
1,
290.0
0
2 Utilities

ACCOUNTING 10
0
1 Expense - -
2
0
1
Interest
Expense
17
,20
0.0
0
17,20
0.00
17,
200.0
0
Total
5,4
5,0
92.
00
5,4
5,09
2.00
84
,99
2.0
0
84
,99
2.0
0
6,15,29
2.00
6,1
5,2
92.
00
88,
672.0
0
1,8
2,7
50.
00
5,26
,448.
00
5,2
6,4
48.
00
Profit
earned
94,
078.0
0
1,82,
750.0
0
1,8
2,7
50.
00
Step 4:
Income statement

ACCOUNTING 11
Revenue
1,82,750.0
0
Less: expenses:
Advertising Expense
1,400.
00
Automobile Expense
5,775.
00
Depreciation Expense - Furniture
8,000.
00
Depreciation Expense - Equipment
16,000.
00
Depreciation Expense - Store
Equipment
12,000.
00
Depreciation Expense - Automobile
17,000.
00
Insurance Expense
3,952.
00
Maintenance Expense
4,900.
00
Miscellaneous Expense
1,155.
00
Rent Expense -
Supplies Expense 1,290.

ACCOUNTING 12
00
Utilities Expense -
Interest Expense
17,200.
00
88,672.0
0
Gross profit
94,078.0
0
Step 5:
Balance Sheet
Cash at bank
71,500.0
0
Accounts receivables
23,830.0
0
Supplies
430.0
0
Prepaid insurance
688.0
0
Total Current Assets
96,448.0
0